Egypt's Prime Minister Sherif Ismail announced on Thursday – hours after the government announced the slashing of energy subsidies – that a new increase in electricity prices will be included in the August bill.
Nearly 24.5 million Egyptians – divided into seven segments according to consumption – benefit from the electricity subsidy.
Ismail said at a press conference that the new increase will “take into consideration” lower-income citizens.
In 2004, the government raised electricity tariffs for the first time in over a decade, with another increase implemented in 2008.
Although Ismail said that the price increase will not result in a rise in public transportation fees, Abu Bakr El-Guindy, the head of Accountability State Authority, said that there will be an increase of 5 to 15 percent.
Egypt’s cabinet announced on Thursday a new increase in fuel prices, effective immediately, in a move to cut down energy subsidies.
The price of 80-octane gasoline has increased from EGP 2.35 per litre to EGP 3.65.The price of 92-octane gasoline has been raised from EGP 3.50 to EGP 5, while the price of gas cylinders doubled from EGP 15 to EGP 30.
Ismail said that the cuts in energy subsidies will free up funds that will be redirected towards measures that would protect low-income citizens.
The move comes as part of the government's five-year plan to gradually scrap its fuel subsidy bill from the state budget. The goal is to decrease subsidies from EGP 145 billion this fiscal year – which ends in June – to EGP 110 billion in the 2017/18 fiscal year.
Fuel subsidy cuts were part of an economic reform package adopted in July 2014 that aimed to ease the country's growing budget deficit.
The first increase of fuel prices came in November, shortly following the Central Bank of Egypt freely floated the pound.